Former Energy Minister, Boakye Agyarko, says Ghana is better off with the US$170million judgement debt awarded against it in favour of the Ghana Power Generation Company (GPGC).
A Commercial Court in London instructed Ghana to pay the whopping amount in damages to GPGC. This was after the court rejected a late appeal by the government of Ghana to set aside the judgement awarded against it. The London-based United Nations Commission on International Trade Law (UNCITRAL) Tribunal on January 26, 2021, awarded the judgement debt against Ghana.
Out of the total, U$134.35 million represents the early termination payment claim, which itself is made up of US $69.36 million as an early termination fee, US$58.49 million for mobilization costs, US$6.46 million as demobilization cost and US$32,448 as preservation and maintenance cost.
Another US$614,353.86 was also awarded against Ghana as the cost of the Tribunal, and expenses of US$3 million against Ghana, being the legal fees expended by the GPGC during the arbitration.
Reacting to the development, the former Energy Minister justified the cancellation of the power agreement with the GPGC, explaining that per the wisdom of the review committee, the power agreement as they were if allowed, the country would pay at the end of the 13th year US$7.2billion in excess capacity charges.
“Now if the country is going to be saddled with $7.2 billion for excess capacity, we needed to rethink. In the PPA review, what it said was that if we could get the termination and the management of all the excess capacity, the liability that we will be faced with is about $600 million out of pocket,” he told Accra-based Citi FM.
“Now $600 million in year one compared to $7.2 billion, now even if you do the next present value calculation and bring the $7.2 billion into a one-year payment, we are still better off. I don’t understand why the people whose time these excess capacity contracts were signed now have the guts and the audacity to accuse people who are trying to manage the mess they created,” he added.
Ghana had 28 days under British law to appeal the Tribunal’s decision. Instead, the country waited three days to expiry the deadline to ask for an extension through Omnia Strategy, a British law firm. The firm asked for 56 days—twice the allowed grace period. The court, however, set March 8, 2021, for the government of Ghana to file the processes to appeal the Tribunal’s decision but again, the government waited until April 1, 2021, before filing through another British law firm, Volterra Fietta.
The law firm received the instructions to represent the country ten days after Ghana’s Attorney General and Minister for Justice. However, on June 8, 2021, the London Commercial Court presided by Justice Butcher ruled on the matter, noting the excuses given by the government of Ghana were unreasonable and “intrinsically weak.”